Australian watchdog takes GlaxoSmithKline, Novartis units to court

Reuters Staff

2 Min Read

(Reuters) - The Australian Competition and Consumer Commission (ACCC) on Wednesday said it is taking local units of GlaxoSmithKline (GSK.L) and Swiss healthcare company Novartis (NOVN.S) to court over false or misleading representations in the marketing of pain relief products.

Swiss drugmaker Novartis' logo is seen at the company's plant in the northern Swiss town of Stein, Switzerland October 23, 2017. REUTERS/Arnd Wiegmann

The ACCC alleged that the companies tried to market their two pain relief products, Osteo Gel and Emulgel, as having different levels of impact in treating osteoarthritis, when in fact they are “identically formulated”.

”We allege that consumers are likely to have been misled into purchasing Osteo Gel thinking that it is different to Emulgel and more effective for treating osteoarthritis conditions, when this is not the case”, ACCC Chairman Rod Sims said.

ACCC’s concerns come as a price sampling conducted by it noted that supermarkets and pharmacies often sold Osteo Gel at a significant price premium to Emulgel.

The regulator is seeking declarations, injunctions, pecuniary penalties, and a publication order in relation to its allegations.

”The alleged conduct is particularly concerning, given the significant penalties handed down by the court against the makers of Nurofen for what we consider to be similar conduct,” Sims said.

In December last year, the Federal court of Australia upheld an appeal by the regulator against Reckitt Benckiser’s (RB.L) Australian unit for similar charges on its Nurofen Specific Pain products, imposing a A$6 million (£3.40 million) penalty.